Cutbacks in annual pension increases unconstitutional, Schimpf says

Automatic annual increases that were promised as part of state worker pensions cannot be cut back under the Illinois Constitution, the Republican candidate for attorney general says.

“A reduction of the cost-of-living adjustment is a diminishment in the pension,” Paul Schimpf said at a Statehouse news conference Tuesday. “There is absolutely no way around it.”

The state Constitution says pension benefits granted public workers “shall not be diminished or impaired.”

Schimpf, of Waterloo, alleged that Democratic Attorney General Lisa Madigan, who is defending the constitutionality of pension reform that cuts back on the annual increases, has a conflict of interest because her father is House Speaker Michael Madigan, D-Chicago.

The elder Madigan was House sponsor of the pension reform, and Schimpf said other lawmakers followed the speaker's lead in believing it was constitutional.

“We're not going to find a better example of her conflict of interest than this,” Schimpf said of Lisa Madigan, a former state senator who is seeking her fourth four-year term as attorney general in November. “Lisa Madigan's loyalty to her father's legislative agenda has precluded her from objectively assessing the constitutionality” of the pension legislation.

“The attorney general is doing her job, which as the state's chief legal officer … is to defend the laws of the state of Illinois,” said Ann Spillane, Madigan's chief of staff, in response to reporters' questions she said she was taking in time off from her state job.

Pension legislation passed in late 2013 affecting state workers and public school teachers is now under review in Sangamon County Circuit Court due to challenges from various employee and retiree groups.

Schimpf said if he were attorney general, he would not defend what he called the cost-of-living adjustment changes in the pension law, because he considers them “clearly unconstitutional.” He added, however, that for anyone to say they know how a court will rule is “just betraying their ignorance.”

“The attorney general has to be guided by the law,” Spillane said, adding there is no Illinois case law on the provisions of the pension legislation, Senate Bill 1, and that the courts — not the attorney general — will decide what is constitutional.

Spillane said that the attorney general will present arguments in court, based on the law, that “in the face of unprecedented fiscal crisis, we believe the law allows the state to modify the pension benefit in an effort to preserve the pension system (for) retirees and employees, and to protect taxpayers from billions of dollars in pension shortfall.”

Schimpf said at the Statehouse that circumventing constitutional language due to a perceived state emergency or crisis is a “dangerous idea.”

“Constitutional provisions apply at all times,” Schimpf said. “In fact, the whole purpose of having a constitution is to protect us from politicians citing emergencies as the basis for dubious legislation.”

He told reporters he realizes the pension system “must be reformed” or “the citizens of Illinois will be crushed under an avalanche of property taxes.”

Asked how he would fill the budget gap if the cost-cutting pension legislation is rejected by courts, Schimpf said the key is to “make our economy robust once again.”

The pension law has been put on hold by Circuit Judge John Belz, who has yet to rule on the combined cases.